Frequently Asked Questions
Financial Planning can be integrated and comprehensive, where all elements of your financial affairs (like retirement planning, investments, insurance and college funding) are brought together into a coordinated, cohesive plan. Or, it can be very specific, focusing just on a single issue of importance or concern to you. In either case, financial planning is a multi-step process that provides you with two important deliverables. First, an in-depth review of your current situation (either comprehensive or specific, depending on your planning objective) and secondly, a roadmap that provides clear direction on how to achieve your planning goal(s). It is important to remember that financial planning is a dynamic process, not a single, one-time event. The economy, your planning objectives and earned income can all change, necessitating a revisit of the roadmap.
Any individual, couple or family seeking financial advice can benefit from our services. We have pledged to offer our services to all persons, regardless of their income or assets. We welcome clients who simply want a one-time financial review or are interested in a second opinion before making a major financial decision. Equally welcome are those persons who are seeking ongoing financial coaching and plan monitoring over a longer period of time.
Any organization (profit or non-profit) wanting to provide unbiased, conflict of interest free advice and financial education to their employees can benefit from our services. We can also provide financial advice and coaching to rank and file employees and/or senior executives on a retainer basis. Your employees will appreciate the fact that you have engaged an independent, fee-only firm, thus eliminating the possibility of sales pressure related to product sales or bundled services. Call us for details 574-975-3682.
Fee-Only financial planners are paid only by their clients. They never receive any commissions, sales incentives, bonuses or special perks paid by insurance companies or other financial service entities for selling their products. Integrated Financial Planning Solutions is a true Fee-Only financial planning firm. Knowing this, you can approach us with the full knowledge that we will be bringing recommendations that are in your best interest only. You do not have to worry that we will need to “sell you something” in order to be paid for providing you advice.
Our fees are based on the time we spend meeting with you, either in-person or over the phone, researching and analyzing your situation, and formulating our recommendations that are specific to your situation. Before you hire us, we will always provide you with a written quote of the full cost of the engagement. We fully disclose all of our fees. We offer an initial consultation, up to one hour, that is complimentary to prospective clients. Following the delivery of our financial plan, if you have questions or need clarification on anything we recommend, please feel free to give us a call. We will not bill for modest amounts of additional time spent during the 30-day period after we present our recommendations to you. We realize that our plan must be understood by you to secure the necessary emotional ownership required for full implementation.
For a complete description of the three levels of financial planning offered by Integrated Financial Planning Solutions, review our services.
The following principles and convictions will inform the investment recommendations that we present to our clients:
a. The asset allocation decision will be the most significant factor in determining your long-term investment performance. Asset allocation refers to the way you divide your investments between stocks, bonds and cash. We believe that there is a direct correlation between risk and return- i.e. investors receive a “risk premium” in the form of higher returns for choosing investments that carry greater risk.
b. We believe that investing in stocks requires a time horizon of at least five years or longer. Investors who will need access to their funds within five years should not be in the stock market. As we experienced from 2000-2009, stocks are capable of delivering 0% returns for an entire decade.
c. We do not believe in market timing, which is a strategy that seeks to move in and out of the market (bond or stock) in anticipation of either upward or downward market movements. Few (if any) investment professionals have, over a long period of time, demonstrated their ability to consistently add value beyond a “buy and hold” strategy. We believe in controlling risk through a prudent asset allocation strategy, not by attempting to “time the market”.
d. We believe that there is a role for both active and passive investing strategies. To clarify, “active” management is an investment approach where fund managers choose securities based on research, judgment and financial analysis. “Passive” management is a buy-and-hold strategy that seeks to provide broad market exposure and typically tries to replicate the returns of a designated index (like the S&P 500). Passive investors make no attempt to exclude or include a stock in their portfolio based on criteria used by active managers. For many investors, we recommend a “Core + Satellite” investing model. Conventional wisdom holds that the purpose of core portfolio holdings has been to harness the long-term appreciation potential of traditional assets such as large-company stocks and high-quality bonds. The goal of asset allocation has been to strike a balance between these two low correlation asset classes that optimizes their risk-adjusted returns. However, following the economic crisis of 2008-early 2009, we believe that there are three key factors that need to be considered in constructing the core portion of investors’ portfolios. These factors are: historically high volatility, historically low interest rates, and renewed awareness of the potential for historical correlations to break down. In this environment, traditional holdings – especially long-only stocks- may be too volatile for many investors, especially those nearing or in retirement. We believe that post-crisis core portfolios may benefit from some revisions to traditional asset allocation, and believe that hedged equity, global fixed income and risk-managed alternative investments may be more appropriate for many investors.
e. We believe that fees and expenses have a very negative impact on our client’s wealth over a long period of time. For example, if two investors with $100,000 are able to earn an average of 9% per year over a 20-year time period, but one investor chooses higher cost investments that assess an extra 1% per year in fees, the investor with the higher costs will have $94,345 LESS at the end of the 20-year period. Expenses and fees must be carefully managed. For an excellent understanding of the importance of low-cost, passive investing (index) vist www.transparentinvesting.com.
f. We believe in Sustainable Investing. Sustainable Investing is the full integration of environmental, social and governance (ESG) factors into investment analysis and decision making. By combining rigorous financial analysis with equally rigorous ESG analysis, we believe that it is possible to identify better-managed companies that:
• Are leaders in their industries
• Are more forward-thinking
• Are better at managing risk
• Meet positive standards of corporate responsibility
• Focus on the long-term
We believe that companies with superior sustainability performance are also better long-term investments. By investing in these companies, we intend for our clients to benefit from their vision and success.
Yes, with certain limitations. Section 212 of the Internal Revenue Code permits an itemized deduction for tax and/or investment advice in the miscellaneous section of Schedule A on your Federal Income tax return. It is currently subject to a 2 percent floor of adjusted gross income.
The “7 Steps” approach was designed to clearly communicate the way that we work our clients and to clarify the roles and responsibilities of the financial planner and the client. Review a detailed description “7 Steps” process.
Call us at 574-975-3682 or e-mail us at email@example.com to schedule an introductory meeting. We offer a no-fee, no obligation “Get Acquainted” meeting, either by phone or in our office. Our office is located at 203 South Main Street, Suite 2A in downtown Goshen, IN.
Although an investment advisory fee of 1% of assets under management may seem like a modest price to pay for investment management, when compounded over time, this "modest" fee can add up to some very large sums of money. Please review the "Comparative Cost Analysis of Investment Management" that illustrates the cost savings that can accrue to those investors who are willing, with professional guidance from a fee-only financial planner, to take more control and involvement in managing their investments. Please call us if any of the data requires an explanation.